Coculture of hematopoietic stem cells (HSC) with primary stromal cells from HSC niches supports the maintenance and expansion of HSC and progenitors ex vivo. However, a major drawback is the availability of primary human samples for research and clinical applications. We investigated the use of in vitro derived osteoblasts as a new source of feeder cells and characterized the molecular pathways that mediate their growth-promoting activities. First, we compared the growth and differentiation modulating activities of mesenchymal stromal cells (MSC)-derived osteoblasts (M-OST) with those of their undifferentiated precursor on umbilical cord blood (UCB) progenitors. Feeder-free cultures were also included as baseline control. Cell growth and expansion of hematopoietic progenitors were significantly enhanced by both feeder cell types. However, progenitor cell growth was considerably greater with M-OST. Coculture also promoted the maintenance of immature CD34⁺ progenitor subsets and modulated in a positive fashion the expression of several homing-related cell surface receptors, in a feeder-specific fashion. Serial transplantation experiments revealed that M-OST coculture supported the maintenance of long-term lympho-myeloid reconstituting HSC that provided engraftment levels that were generally superior to those from MSC cocultures. Mechanistically, we found that coculture with M-OST was associated with enhanced beta-catenin (β-Cat) activity in UCB cells and that abrogation of β-Cat/T-cell factor activity blunted the growth-promoting activity of the M-OST coculture. Conversely, Notch inhibition reduced UCB cell expansion, but to a much lesser extent. In conclusion, this study demonstrates that M-OST are excellent feeder cells for HSC and progenitors, and it identifies key molecular pathways that are responsible for the growth-enhancing activities of osteoblasts on UCB progenitors.